1 U.S.A dollar banknotes

$15 Per Hour Minimum Wage Now Available for Government Contractors

President Joe Biden signed an executive order on April 27, 2021, to require some federal contractors to pay workers at least $15 per hour. This EO applies to those on government contracts, and the higher minimum wage goes into effect beginning January 30, 2022.

Biden also tied the minimum wage to be adjusted each year for inflation as part of the executive order. It will be at a rate set by the Labor Secretary.

The Biden administration hopes to enhance worker productivity, reduce absenteeism, and lower training and supervisory costs by taking these steps.

Agencies are “strongly encouraged” to make the pay raise active immediately as of the order date. New government contracts now include a clause mandating that covered contractors and subcontractors take the requirement into the lower-tier documents.

What Is the Impact on Tipped Minimum Wage?

Biden’s executive order makes changes to the tipped minimum wage for some federal contractors. Starting on the January 30, 2022, date, workers who get tips must receive a base pay of $10.50 per hour.

There are also provisions for the following years (2023 and 2024) that contractors must pay tipped workers 85% and the higher minimum wage, respectively.

If a tipped workers’ hourly wages don’t reach the higher amount, the contractor must increase salaries to make up the difference.

This EO replaces the one signed by Barack Obama in 2014. That order required federal contract workers to earn $10.10 per hour, indexed to inflation. Under that structure, the current hourly wage was $10.95 in 2021.

Although the wage difference is notable, the orders from Obama and Biden appear pretty similar in how they operate. Both focus on concessions and services without applying to tribal agreements.

Biden’s EO also revoked one of Trump’s orders that provided an exemption for recreational services on federal lands.

Highlights of the Biden Executive Orders Signed in His First 30 Days

Most U.S. Presidents want to get off to a fast start when they take office. Since the election gives them the mandate to make some changes, the first 100 days are often seen as a gauge of what to expect in the coming years.

When Biden was sworn into office, he started signing executive orders within hours to begin the process of correcting what he thought was wrong with the country.

Here are the highlights of the various executive orders signed in the first month of the Biden Administration.

Biden Made an Aggressive Push on the Executive Order Front

The following table doesn’t show the proclamations, changes, or requests that don’t involve an executive order.

For example, Biden’s first action was to re-engage with the World Health Organization. That step didn’t require an executive order to complete on January 20.

Executive OrderSubject MatterDate
Create the position of a COVID-19/coronavirus response coordinator.This EO provides for streamlined vaccine distribution and virus management duties.January 20
Revoke Keystone XL pipeline.Biden paused energy leasing in ANWR while stopping the construction of the oil transportation pipeline.January 20
Launched an initiative to advance racial equity in schools.This EO effectively ended the 1776 Commission that looked at how American history got taught.January 20
OSHA guidance updates.This order looks at how to keep workers safe from COVID-19.January 21
Re-establish the White House Office of Faith-Based and Neighborhood Partnerships.The goal of this EO is to address the needs of low-income Americans.February 14
Revoke city targeting when local officials declare themselves as sanctuaries.With this executive order, Biden hopes to remove “anarchist” titles from U.S. communities.February 24
Rebuild the U.S. refugee resettlement program.This order works to restore the systems used to resettle refugees when their lives are threatened in their home countries.February 4